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Present (via Teams)

  • Jeremy Miles MS (Chair)
  • Eluned Morgan MS
  • Julie James MS
  • Kirsty Williams MS
  • Ken Skates MS
  • Lesley Griffiths MS
  • Rebecca Evans MS
  • Vaughan Gething MS
  • Dafydd Elis-Thomas MS
  • Des Clifford, Director General, OFM
  • Piers Bisson, Director, European Transition
  • Simon Brindle, Director, Brexit Strategy
  • Tim Render, Director, Land, Nature and Food
  • Carys Evans, Principal Private Secretary, First Minister
  • Gareth Williams, Special Adviser
  • Jane Runeckles, Special Adviser
  • Dan Butler, Special Adviser
  • Damian Roche, Cabinet Secretariat (minutes)
  • Toby Mason, Director of Communications
  • Liz Lalley, Deputy Director, European Transition (Preparedness)
  • Emma Edworthy, Deputy Director Trade Policy
  • Rob Parry, Deputy Director, European Transition (Legislation)
  • Michelle Grey, Head of Negotiation Policy and Co-ordination
  • Euros Jones, European Transition
  • Lauren Stamp, Senior Private Secretary, CGMET
  • Paul Harrington, Head of Intergovernmental Relations, European Transition
  • Enfys Dixey, Head of Economic Competitiveness Policy
  • Ed Sherriff, Deputy Director, European Transition (Negotiations)

Apologies

  • Rt Hon. Mark Drakeford MS

Item 1: Minutes of the previous meeting and actions arising

  1. The minutes of the 13 May were agreed. The majority of the actions had been completed with only one outstanding, which was for officials to map interlinkages between COVID-19 and EU transition. This work was ongoing and Cabinet were due to consider a paper on this shortly.

Item 2: Update on developments

  • The Counsel General and Minister for European Transition provided an update on developments since the last meeting.
  • It was noted that the amount of secondary legislation necessary this year would be a challenge. However, detail was lacking from the UK government about the overall programme. 
  • The majority of SIs would be laid towards the end of the year, creating a significant challenge for Welsh Government in terms of analysing UK SIs and advising on consent, along with the timing of Welsh SIs if they followed UK/English SIs in sequencing. The Sub-Committee would need to return to this at future meetings.
  • On 20 May, the UK government published its Command Paper: The UK's Approach to the Northern Ireland Protocol. The Command Paper set the broad parameters but failed to provide the details necessary to understand how the Northern Ireland Protocol would be implemented.
  • On 12 June, the UK government announced that border controls for EU goods imported into Great Britain would be introduced at the end of the Transition Period in stages, to give businesses affected by coronavirus more time to prepare. There would be new GB border infrastructure to carry out checks and £50 million of grants to accelerate growth of the UK’s current customs intermediaries’ sector.
  • Both of these developments would have potentially profound consequences for Welsh Ports. Officials were working to understand further the implications as part of the preparedness work stream.
  • There remained a lack of meaningful engagement from the UK government, despite continued efforts to secure this. The Counsel General had continued to discuss matters with the Paymaster General and the first virtual JMC(EN) took place on 21 May. A joint letter from the First Ministers of Wales and Scotland calling for an extension to the transition period, followed by a written statement from the Counsel General to the Senedd had set out the Wales position, yet despite these representations and the impact of leaving the transition period without a deal would have on the economy, the UK government had refused to request an extension.
  • The Sub-Committee noted the update.

Item 3: UK/EU negotiations

  1. The Counsel General and Minister for European Transition introduced the paper, which provided an update on the latest developments in the negotiations with the EU and the rest of the world.
  2. The 4th round of formal negotiations had concluded and a High Level Stocktake meeting had been held between the UK government and EU, at which it was agreed to intensify talks during July and August to progress negotiations.  
  3. The Counsel General had pressed UK government ministers for a reboot of engagement with devolved governments ahead of the new phase of negotiations, and whilst the Paymaster General had signalled proposals would be made to the Chancellor of the Duchy of Lancaster for decision, details were still awaited.
  4. The Sub-Committee discussed the purpose of establishing ‘offensive interests’ and noted that areas where compromises could be made were also important, as well as the importance of focusing on specific priorities in the limited opportunities available. 
  5. The Sub-Committee noted the paper.

Item 4: Trade policy

  1. The Minister for International Relations and the Welsh Language introduced the paper, which considered Trade negotiations with the Rest of World, particularly with the priority countries including the US, Japan, New Zealand and Australia.
  2. Recent developments included the 2nd round of US negotiations beginning on June 15; negotiations with Japan launched on June 9 and negotiations with Australia and New Zealand launched on June 17. A written statement was published on 18 June offering the Welsh Government’s initial views on these Free Trade Agreement (FTA) negotiations.
  3. The engagement with the UK government on these new FTAs had been relatively positive. Information sharing was generally timely and the Welsh Government was being afforded the opportunity to comment. Relationships between officials and DIT were effective and policy discussions taking place before and after each round had been helpful to understand how negotiations were progressing.
  4. The negotiating timetable was extremely tight. Both parties were aiming for an agreement to be in place for the end of the transition period in order to create continuity for businesses. The bulk of the deal would need to be agreed by the end of July to allow time for translation and legal formalities.
  5. Negotiations had been launched with Australia and New Zealand the previous week. It was noted that the Minister for International Relations and Welsh Language had published a written statement on the launch of the Japan, Australia and New Zealand negotiations. The economic benefit modelled through DITs scoping assessments showed the importance of ‘trade gravity’ and why the FTAs currently under negotiation must not do anything to undermine negotiations with Wales’ most important trading partner - the EU.
  6. Engagement on the negotiations would be similar to others, including briefings before and between rounds, one to one discussions with policy teams and the sharing of draft legal text.
  7. In relation to the UK Trade Bill, it had been confirmed the UK government would not usually use the powers in the Bill without consent of the devolved administrations. A new commitment had also been secured that would ensure the UK government would work closely with DA’s during the negotiations.
  8. It was too early to accurately determine the full and long-term impact of COVID-19, however early indications suggested a severe impact for the whole economy, including trade. How quickly consumer and business expenditure bounced back would be determined by the progress of the virus.
  9. The Sub-Committee noted the update paper.

Item 5: Preparedness update

  1. The Counsel General and Minister for European Transition introduced the item, which provide an update on recent developments on preparedness for the end of the transition period, particularly in relation to engagement with the UKG on UK-wide preparedness projects.
  2. A small improvement in the level of central UK government engagement had been seen, with some limited information being shared by the UK Cabinet Office where the UK government believed the devolved governments would need to be involved, or which could affect devolved areas. The information received was similar to information that was shared by the UK government last year as part of no deal exit preparedness work.
  3. Assessments were currently being made and a further update would be provided at the next meeting. Lead officials would need to be identified for each strand of work and further information on this would be provided to the Sub-Committee.
  4. The information shared was welcome, but it remained inadequate for the scale of work required, and there was an urgent need for joint work and information sharing to step up significantly. This was especially important with the announcement that the transition period would not be extended, and therefore preparedness work would need to continue and intensify.
  5. It was reported that the UK government planned to embark on a major communications campaign in July to prepare people and businesses for the end of the transition period. This could cause a major challenge for the Welsh Government, should the UK government not share its plans, or if the material was not appropriate in Wales. In addition, Welsh Government communications capacity for EU exit work was very limited due to the focus rightly being on the COVID-19 response and recovery work.
  6. The Sub-Committee noted the update.

Item 6: Frameworks and internal market

  1. The Counsel General and Minister for European Transition introduced the paper, which set out the proposed approach to prioritising the delivery of Common Frameworks and developments with the UK internal market.
  2. The Frameworks programme had recalibrated its delivery schedule with the aim that all areas would have reached at least the basic stage of development that would allow them to be operational in some form by the end of this year, though it was likely that a significant proportion would still be subject to scrutiny by the legislatures in 2021.
  3. Delivering to this timescale would be a challenge for all 4 governments, particularly as a number of points fundamental to the completion of the Frameworks, such as the relationship with the EU, the working of the UK Internal Market and post-transition funding, would not be resolved until close to or in some cases beyond the end of the year.
  4. The work on the Internal Market was developing but was causing significant concern. The UK government were due to publish a Green Paper shortly, and their strong preference seemed to be to bring forward legislation to govern the internal market across the UK, which would go further than retained EU law.
  5. The Sub-Committee agreed the paper.

Cabinet Secretariat
June 2020

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